Janus Products, Inc. is a merchandising company that sells binders, paper, and other school supplies. The company is planning its cash needs for the third quarter. In the past, Janus Products has had to borrow money during the third quarter to support peak sales of back-to- school materials, which occur during August. The following information has been assembled to assist in preparing a cash budget for the quarter: a. Budgeted monthly absorption costing income statements for July to October are as follows: Sales $ July 59,000 $ August September October 89,000 $ 69,000 $ 64,000 Cost of goods sold 31,600 49,600 37,600 34,600 Gross margin 27,400 39,400 31,400 29,400 Selling and administrative expenses: Selling expense 12,900 15,500 10,400 9,200 Administrative expense* 6,600 9,100 8,000 7,800 Total selling and administrative expenses 19,500 24,600 18,400 17,000 Net operating income $ 7,900 $ 14,800 $ 13,000 $ 12,400 Includes $2,950 depreciation each month. b. Sales are 20% for cash and 80% on credit. c. Credit sales are collected over a three-month period, with 10% collected in the month of sale, 70% in the month following sale, and 20% in the second month following sale. May sales totalled $49,000, and June sales totalled $55,000. d. Inventory purchases are paid for within 15 days. Therefore, 50% of a month's inventory purchases are paid for in the month of purchase. The remaining 50% are paid in the following month. Accounts payable for inventory purchases at June 30 total $21,200. disa inventory levels at 75% of the cost of the merchandise to be sold in the following month. The Janus Products, Inc. is a merchandising company that sells binders, paper, and other school supplies. The company is planning its cash needs for the third quarter. In the past, Janus Products has had to borrow money during the third quarter to support peak sales of back-to- school materials, which occur during August. The following information has been assembled to assist in preparing a cash budget for the quarter: a. Budgeted monthly absorption costing income statements for July to October are as follows: July August September October Sales $ 59,000 $ 89,000 $ 69,000 $ 64,000 Cost of goods sold Gross margin 31.600 49,600 37,600 34,600 27,400 39,400 31,400 29,400 Selling expense Selling and administrative expenses: Administrative expense* 12,900 15,500 10,400 9,200 6.600 9,100 8,000 7,800 Total selling and administrative expenses 19,500 24,600 18,400 17,000 Net operating income $ 7,900 $ 14,800 $ 13,000 $ 12,400 Includes $2,950 depreciation each month. b. Sales are 20% for cash and 80% on credit. c. Credit sales are collected over a three-month period, with 10% collected in the month of sale, 70% in the month following sale, and 20% in the second month following sale. May sales totalled $49,000, and June sales totalled $55,000. d. Inventory purchases are paid for within 15 days. Therefore, 50% of a month's inventory purchases are paid for in the month of purchase. The remaining 50% are paid in the following month. Accounts payable for inventory purchases at June 30 total $21,200. disc inventory levels at 75% of the cost of the merchandise to be sold in the following month. The